Czech Republic Economic Data & Projections

Czech Republic Economic Outlook

Central Europe’s industrial powerhouse:

The Czech Republic has one of the most advanced economies in Central and Eastern Europe, with a GDP of around $350 billion. The country boasts a strong industrial base, a skilled workforce, and a favorable business environment. It is one of the EU’s most manufacturing-intensive economies, with automotive production playing a crucial role. Economic growth has been solid in recent years, although high inflation and weak external demand slowed activity in 2023.

Automotive and export-driven economy:

The Czech Republic is a key European hub for automobile production, home to major manufacturers like Škoda Auto (owned by Volkswagen) and numerous auto parts suppliers. The country is also a significant exporter of machinery, electronics, and pharmaceuticals. Germany is its largest trading partner, making the Czech economy highly sensitive to fluctuations in German industrial output.

Challenges:

Inflation surged above 15% in 2022, eroding real wages and dampening consumer spending, though it moderated in 2023. The Czech Republic also faces long-term labor shortages due to a low unemployment rate and demographic challenges. Additionally, while the country has strong fiscal discipline, it has delayed euro adoption, preferring to maintain control over its monetary policy.

Czech Republic’s economic forecasts:

The Czech economy is expected to regain momentum as inflation stabilizes and external demand recovers. Continued investment in automation, energy transition, and infrastructure will support industrial competitiveness. However, exposure to external shocks—particularly from Germany and the EU—poses a risk. The country’s ability to maintain strong economic fundamentals while addressing labor shortages and energy security concerns will determine its long-term trajectory.

Czech Republic's Macroeconomic Analysis:

Nominal GDP of USD 345 billion in 2024.

Nominal GDP of USD 343 billion in 2023.

Nominal GDP of USD 345 billion in 2024.

GDP per capita of USD 31,626 compared to the global average of USD 10,589.

GDP per capita of USD 31,548 compared to the global average of USD 10,589.

GDP per capita of USD 31,548 compared to the global average of USD 10,589.

Average real GDP growth of 2.2% over the last decade.

Average real GDP growth of 2.2% over the last decade.

Average real GDP growth of 2.2% over the last decade.

Sector Analysis

In 2022, services accounted for 59.8% of overall GDP, manufacturing 21.4%, other industrial activity 17.2%, and agriculture 1.6%. Looking at GDP by expenditure, private consumption accounted for 45.6% of GDP in 2023, government consumption 20.4%, fixed investment 28.9%, and net exports 5.1%.

International trade

In 2023, manufactured products made up 90.1% of total merchandise exports, mineral fuels 1.9%, food 5.3%, ores and metals 1.4% and agricultural raw materials 1.0%, with other categories accounting for 0.3% of the total. In the same period, manufactured products made up 83.4% of total merchandise imports, mineral fuels 6.1%, food 6.3%, ores and metals 2.9% and agricultural raw materials 0.9%, with other goods accounting for 0.4% of the total. Total exports were worth USD 196.70 billion in 2024, while total imports were USD 178.70 billion.